What is the 15*15*15 Rule in Mutual Funds?

The 15*15*15 rule in mutual funds is an investment strategy with the potential to generate a considerable return over the course of 15 years. With patience and a disciplined SIP investment, such a strategy might help you build up a wealth of over INR 1 crore after the tenure.

Overview of the 15*15*15 Rule in Mutual Funds

If you are keen on investing in a mutual fund, you must know that funds, especially the equity ones, when they perform well, can deliver an average return of up to 15% over the long term.

Here comes the concept of the 15*15*15 rule in mutual funds, where, due to the compounding interests, it might be possible that you build a portfolio with more than INR 1 crore.

For a better understanding, here is a detailed breakdown of a 15*15*15 mutual fund:

1. Choose a mutual fund with the potential to deliver a 15% annualised return in the long term.
2. You must invest in mutual funds using a Systematic Investment Plan (SIP) of INR 15,000  per month.
3. Set your investment horizon for 15 years to achieve the potential return.

The objective behind such an investment strategy is to set an investment discipline. Here, with a modest investment amount per month, you can enhance your chances of enjoying impressive returns from the right fund.

Understanding the Power of Compounding

Combining the benefits of SIP with the power of compounding, the 15*15*15 rule in mutual funds has the potential to generate a higher return. Below is a detailed description of SIP and compounding:

1. As of 2025, the Association of Mutual Funds in India data shows that there is a net inflow of INR 28,000 crore in the form of SIP, making it a popular investment mode. Therefore, if you choose SIP for investment, you can leverage the power of compounding.
2. Here, you are not limited to earning interest on your SIP investments themselves. Compounding makes the return generated by your SIP amount to earn a return as well.
3. Over a longer investment horizon, this creates a snowball effect. Here, your investments grow much faster the longer they stay invested in a fund, which investors refer to as exponential growth.
4. To maximise the power of compounding and apply the 15*15*15 rules, it is best to start investing early. Young investors generally have higher risk tolerance. Early investing also gives time to recover from market losses or adjust strategies.

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Working Mechanism of Compounding in Mutual Funds

To better depict the working process of compounding, let us look at an easy example.

To figure out the possible return that you can have from a 15*15*15 rule in mutual funds, at the same time, suppose you invest in a mutual fund with an INR 15,000 SIP. The annualised return is  15%, and your investment horizon is 15 years.

Here is a detailed return table highlighting the possible amount you will get after 15 years of investment:

The table clearly depicts how small gains over the 15-year course snowball into considerable growth. Due to the power of compounding, the return on year 15 is almost 3 times your entire SIP contribution to the fund.

Why the 15*15*15 Rule in Mutual Funds is a Smart Investment Strategy?

With reference to the example in the above table, here is a further discussion to help you understand how the 15*15*15 rule in mutual funds works:

1. A mutual fund with a 15% annualised return might provide you with an accumulated wealth of about INR 1,01,52,946 after 15 years.
2. Now, imagine SIPs generating returns without the power of compounding. In such a scenario, the same investment would generate a return of INR 60,75,000.
3. Adding this to your total investment amount of INR 27,00,000, your entire return amount would be INR 87,75,000.
4. Due to the compounding effect in this investment rule, your accumulated interest in the 15th year is INR 74,52,946. This clearly shows a massive difference in generated interest between the two interest methods.
5. As the 15*15*15 rule in mutual funds leverages the power of compounding with an affordable SIP, you can go beyond this rule by extending your investment tenure.
6. Based on the working process of this investment rule, if you invest for 5 more years, you might get a return of INR 1,91,39,325. If you plan your investment for 30 years, your accumulated wealth might become INR 10,51,47,309.

Advantages of the 15-15-15 Rule in Mutual Fund Investments

Typical features of mutual fund investments, such as potential lower risks, diversification and the effect of rupee cost averaging, act as an added advantage with this mutual fund investment method:

1. Usually, long-term investments are conceived as a less risky option compared to short-term investments. As the investment horizon of this rule is 15 years, your chosen fund has time and might overcome fluctuations to recover from losses.
2. When you invest in a mutual fund, your fund manager allocates the fund across asset classes to reduce risk. This also helps you achieve steady growth over the 15 years of investments.
3. Investing through SIPs lets you benefit from the rupee cost averaging effect. By investing INR 15,000 monthly, you buy fewer units when the market is up and more when the market is low. This balances your portfolio and helps with long-term goals.

Conclusion

The 15*15*15 rule in mutual funds means investing INR 15000 as SIP in a mutual fund with a 15% potential annualised return. The investment horizon is also for 15 years. This investment option leverages the compounding power and has the potential to generate considerable wealth after the tenure.

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Frequently Asked Questions

1. How to invest in 15*15*15 in a mutual fund?

You must choose a mutual fund with the potential to deliver a 15% annualised return. Invest in that fund for 15 years with an SIP of INR 15,000.

2. What is the 15*15*30 rule in mutual funds?

Similar to the 15*15*15 rule in mutual funds, you invest the same amount at the same annualised return, but for 30 years.

3. Can we get a 15% return on a mutual fund?

The investment market is highly volatile, and earning a specified return, such as 15% depends on market and economic conditions. However, if you choose a fund with a good historical performance and the market stays good over the tenure, there might be a chance of getting a 15% return.